Belt And Road After COVID - 19 - Burning Issues

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CHINA’S BRI AFTER COVID-19

About BRI The Belt and Road Initiative is a global development strategy adopted by the Chinese government in 2013 involving infrastructure development and investments in nearly 70 countries and international organizations in Asia, Europe, and Africa.

Curtailed Connectivity after Covid19

A devastating economic collapse of potentially historic proportions after Covid19, leading to social and political turmoil in a number of countries, and curtailed connectivity. Interestingly, the pandemic has exposed the risks and weaknesses of global interconnectedness, which will affect China’s BRI.

Funding Shortfall for BRI

So far, BRI has been powered primarily by China, whose growth rates were decreasing even before the outbreak. Exports Hit: With the United States and Europe reeling from the pandemic, Chinese exports will take a big hit.
China Confronts Major Risk Of Debt crisis on the belt and road due to pandemic
China’s growth hit a near 30-year low of 6.1% in 2019
Roughly 5 million People in china lost their jobs in the first 2 month of 2020
Last February, China’s official urban unemployment jumped to an unprecedented 6.2 percent. Unemployed Number may go up to 9 million by the end of 2020.
Exclusive : China to ramp up spending to revive economic, could cut growth target
China will have to chose out of two competing priorities:
avoiding the middle-income trap,
while at the same time posturing as a superpower abroad.
So, not only may BRI be short of cash, but it will also be hard to sell at home.
All Economies along BRI routes affected
Pakistan, host to the biggest BRI megaproject in the world, is poised to sustain a $8.2 billion loss, according to ADB. The respective figure for Bangladesh is $3 billion. Thailand is now bracing up for a recession. Africa is equally vulnerable, as China is the continent’s largest market.
along BRI routes.
Covid19 hit Chinese companies executing BRI contracts can rely on support from the CDB in the form of low-cost financing.
Yet, Chinese policy banks will be increasingly picky and inclined to stay away from new projects that may turn out to be loss-makers.
China Development bank to support belt and road companies hit by coronavirus Xinhua
Priority list:
No. 1 preserving the CCP’s power
No. 2 maintaining national unity
No. 3 the expansion of the economy
No. 4 environmental sustainability
No. 5 modernize the Chinese military
No. 6 China’ s 14 neighboring states
No. 7 weaken America’s longstanding security alliances
No. 8 terrestrial Silk Road Economic Belt
No. 9 Maritime Silk Road
No 10 reshape the global order
Under extreme circumstances, Beijing will not consider the BRI as important.
Is the BRI Finished then?
Not Exactly!!!
In fact, the initiative’s fuzzy content is being further enriched with the “Health Silk Road” add-on narrative and “mask diplomacy” in a major soft-power push.
China rollout the health silk road
China sends doctors and masks overseas as domestic coronavirus infections drop
Short Term: Yes, BRI will Face Trouble
In particular, the summer of 2020 may be a period of hibernation for a number of BRI projects.
The outbreak has brought Chinese labor supplies and equipment imports along BRI routes down to a trickle.
Long Term: A Changed BRI will Emerge The BRI is bound to change. Strategies will change.
It might even be Defined Properly
Seven years after this ambitious initiative was announced it remains a blurred vision in need of a comprehensive conceptual framework, international standards, and a coherent implementation strategy.
This is one of the reasons why the BRI has become controversial and has caused a backlash in many countries.
A Shift away from Roads and Bridges BRI expenditure up to 2019 stood at $545 billion. (WB Estimate)
About two-thirds of spending on BRI projects has gone into the energy sector and transport
However, developing countries in need of infrastructure will be terribly cash-strapped, there may be a shift away from roads, bridges, and coalfired power plants funded through Chinese loans.
New BRI projects will probably be more strategically chosen.
Beijing has been investing in the creation of a globe-spanning network of economic corridors, logistics zones, and financial centers, with stress laid on sea ports and adjacent areas. Egypt’s Suez Canal Economic Zone and Sri Lanka’s Colombo Port City clearly show this trend.

In addition, projects are likely to focus on more sophisticated forms of connectivity, such as 5G networks or, in the wake of the pandemic, disaster management, public health-related high-tech, and even remote surgery.
China will surely use the BRI for the projection of its soft power, an increasingly important battlefield in international relations.